Yesterday, Intel Corporation (NASDAQ:INTC) announced its first quarter results. The company posted a revenue of $12.6 billion, while earnings came in at 40 cents a share. First quarter gross margins declined 8 percent, Y-o-Y to 56 percent. Wedbush said in its latest research report that though Intel Corporation (NASDAQ:INTC)’s GAAP earnings missed the consensus estimate by a penny, revenues surpassed the highly cautious expectations of investors.

Intel logo

Intel Corporation (NASDAQ:INTC) issued second quarter revenue guidance of $12.9 billion despite a decline in the traditional PC market, which is above the Wedbush estimates. Analysts said that the world’s largest chipmaker is planning to launch its next generation Haswell processor which has many performance benefits and a longer battery life. Wedbush said Intel Corp. (NASDAQ:INTC)’s growth in the second quarter will be driven by the Haswell processor and touchscreen devices, and this is why the chipmaker has increased its Q2 estimate by 3 percent Q-o-Q.

Wedbush senior analyst Betsy Van Hees said that Intel Corporation (NASDAQ:INTC)’s foundry business is rapidly adding several “serious” customers. Intel Corporation (NASDAQ:INTC) has decided to focus on value based pricing for its foundry business. Wedbush believes that the company’s efforts to form multiple strategic business relationships will help it create a “healthy” business generating meaningful revenues after 2-4 years.

Intel Corporation (NASDAQ:INTC) lowered the full-year capital expenditure guidance by $1 billion to $12 billion in 2013. CapEx in the first quarter stood at $2.2 billion. Wedbush said that the lower CapEx guidance was mainly due to the company using more old-generation process equipment for 14 nm due to excess capacity.

Intel Corporation (NASDAQ:INTC) reiterated its full-year revenue guidance of $53.3 billion for 2013, which is 1 percent higher than Wedbush estimates. The company expects full-year gross margins of 60 percent. Intel Corporation (NASDAQ:INTC) repurchased 25 million shares in the first quarter for $533 million, bringing the total shares repurchased to $4.3 billion.

However, there are some serious concerns that worry investors. The chipmaker’s revenues posted a decline across all business divisions. The PC client group sales were down 6 percent in Q1, data center group revenues declined 9 percent, the other Intel architecture group sales were down 4 percent, revenues from software and services group fell 8 percent. Additionally, analysts noted that the lower first quarter gross margins were due to higher factory start-up costs.

Wedbush has a Neutral rating on the stock with $23 price target. Intel Corporation (NASDAQ:INTC) shares were down 1.53% to $21.58 at 9:39 AM EDT.